Purchasing a home can be stressful especially if you are a first time homebuyer.  The more prepared you are in the face of the market and realtors, the better.  Here are some guidelines to help you in this process.

Contact all three credit agencies – equifax.com, experian.com, and transunion.com – to order a copy of your credit report so that you know what lenders will see and there are no surprises.

Review all three reports and check for anything that looks like an error.  Notify the credit agency in writing of any errors and make sure to keep a copy of your letter for your records.  

A lender looks for several things in your credit report, including:

Several websites, including hud.gov, have mortgage calculators that estimate how much you can afford to borrow, but the amounts may vary.  The best place to get an accurate pre-qualification is at a bank or credit union – just ask to speak with a mortgage specialist.  You will be asked about your income, assets, and debts.  Once you have a range of what you can afford, keep these numbers handy.  

Please note that a pre-qualification involves no commitment by either you or the financial institution. It only gives the homebuyer a price range within which to search for a home.

Going to open houses is a good way to get a sense of what is available in a certain area and to interview realtors.  Get a newspaper or ask at a real estate office for the open house listings, and plan a Sunday afternoon visiting homes for sale.  As you look at properties, make a list of what you want in a home and note how important each feature is to you. 

If you are unfamiliar with a particular community, plan to have lunch there, pick up local newspapers, and drive by libraries, schools, and downtown areas.  It is possible to find a home through open houses, but if you want an advocate and adviser, hire a realtor.

Ask friends and colleagues to recommend a realtor, check the local newspaper listings, and search the web, including www.realtor.com, www.zillow.com, www.trulia.com, and www.redfin.com.

Some general questions to ask a realtor are: 

You can apply for mortgage pre-approval before you have chosen a home. Realtors say that sellers would not consider an offer that was not pre-approved. When you are ready to decide on a lender, check the above web sites and the real estate section of the local newspaper for an idea of rates, but always confirm rates with lenders.  Once you have an accepted offer on a property, you have a certain amount of time, which is stipulated in the offer, to obtain a mortgage and have a home inspection done. Be ready to fill out the application and produce any required documentation ahead of time. Websites that help compare mortgage rates include www.lendingtree.com and www.rocketmortgage.com. 

Overall, enjoy the process and take your time to find the property that is the best match for you. Remember that the EAP is here to assist you with financial and legal concerns as well as stress management.